AT&T on Wednesday published an open letter to customers on its iPhone 3G S upgrade eligibility program in which it announced that, for a limited time, it will offer early iPhone 3G adopters the opportunity to purchase an iPhone 3G S at the same $199 and $299 price points as new customers.

The exclusive U.S. iPhone carrier said that generally speaking, the more a customer spends with AT&T, the quicker they become eligible for a price break on a new device. For example, iPhone customers who spend more than $99 a month per line are generally eligible for an upgrade between 12 and 18 months into their contract.

However, with iPhone 3G having launched last July and the new iPhone 3G coming out this June, no iPhone 3G users are eligible to upgrade to the iPhone 3G S at the advertised $199 and $299 price points under AT&T's standard policy because 12 months have yet to pass.

Instead, AT&T said iPhone 3G owners could upgrade to a 16GB or 32GB iPhone 3G S for $399 or $499, respectively, if they wished to do so before they became eligible for upgrade pricing either 12 or 18 months into their iPhone 3G contract.

This led to widespread criticism of the carrier by loyal customers who felt they were getting the shaft for being amongst the quickest to plunk down the cash for last year's iPhone. In its letter Wednesday, AT&T says it hears its customers loud and clear, and concedes it made a mistake.

"Since many of our iPhone 3G customers are early adopters and literally weeks shy of being upgrade eligible due to iPhone 3G S launching 11 months after iPhone 3G, we’re extending the window of upgrade eligibility for a limited time," the carrier said in a statement that was also accompanied by the YouTube video, below.

Specifically, AT&T said it will offer iPhone 3G customers who are upgrade eligible in July, August or September 2009 its best upgrade pricing, beginning Thursday, June 18.

Affected customers who've already preordered from an AT&T store will see the cost of the device adjusted when they come to pick it up. If you pre-ordered from AT&T online, AT&T says it will send you an e-mail and issue a credit.

For customers who pre-ordered an iPhone 3G S through Apple’s online store, your upgrade eligibility will be reassessed based on AT&T's new upgrade policy for iPhone 3G owners. If you are eligible for the lower price, Apple will issue you a credit for the difference as applicable.

"We’ve listened to our customers — and hope our response helps answer some of your questions and concerns," AT&T said. "We are incredibly proud to be the U.S. carrier for the new iPhone 3G S and will work around the clock to be ready on June 19 to serve customers who are interested in the fastest, most powerful iPhone yet."

Love Apple, but it seems like they are heavily losing iPhone market share to RIM, thus the deep discounts.

Quote:

International Data Corp's Mobile Phone Tracker data puts Research In Motion at more than half of the smartphone marketshare for the first quarter of 2009: that 55.3 percent share compared to a 19.5 percent share for Apple's iPhones. That's a dramatic surge from two quarters earlier, when BlackBerry devices hung on to 40.4 percent and Apple had 30.1 percent, according to IDC.

Of course it could very well be the huge amount of people waiting for the new iPhone 3Gs...

So much for that article right? Hehehehe

We will see of course if this course of action by Apple/ATT works.

Opening up the iPhone to other network carriers has helped RIM considerably, Apple should do the same.

This must be a joke cause no one that brought the 3G last year at launch will qualify and those that qualify have been eligible for a upgrade for over a year now cause they brought the 1st gen iphone without it being subsidy. AT&T is doing nothing here really if you think about it.

NO ONE WILL QUALIFY! The rotten thing here is that they requier 18 months to "qualify to upgrade" so no one who bought the phone in June 08 would qualify untill Dec 2009 or Jan 2010 depending on billing cycle...so...who is gong to qualify?

On top of everything else ATT has screwed up, this is like a fuck you to the most loyal customers.

If I cant upgrade now, I will just wait till the 4th itteration of the iphone comes out...hopefully not on an ATT network

You can't quantify how much I don't care -- Bob Kevoian of the Bob and Tom Show.

Still not clear... I thought you could upgrade after 18 months... so December for those who bought last July?? But I guess if you spend more than the basic plan $85 vs $99 then you can upgrade 6 months early. This is still not very clear. So now do I still have to wait for December or am i bumped up an arbitrary number of months (3, maybe?). I'll add a $20 txt plan to the plan for a month then remove it if I can get a new phone 6 months early....

"Education is what remains after one has forgotten what one has learned in school." -- Albert Einstein

Well, RIM has like 127 different versions of the Blackberry and has all 4 major carriers.

Apple has 2 versions of iPhone and 1 carrier.

Yes the iPhone is the anti-Blackberry of the smartphone market. So it's kind of useless to compare apples and oranges.

Just wished Apple made a more serious iPhone version for corporate types w/Exchange, keypad etc. right off the bat, they had RIM by the nuts for quite some time there. Now it's tough times, smart phones are supplemented by business as a expense. So a lot of people will use that instead of buying their own iPhone and trying to work with that.

We will see if the deals/iPhone 3Gs will bounce Apple back up in market share or not.

IMMO, not a lot people have huge amounts of money to spend being upside down on their mortgages and all.

The danger is that we sleepwalk into a world where cabals of corporations control not only the mainstream devices and the software on them, but also the entire ecosystem of online services around...

I bought my 3G the very first day it went on sale, and AT&T just told
me that I'm still not eligible until March 2010. So apparrently the
only people elibigle are ones that bought an original iphone before
spring 2008, and did not extend their contract to get a 3G.

The article is unclear and frankly I agree with several other posters here - how does this help anyone who purchased a subsidized (i.e. contracted phone on release date of last year or frankly, anytime after) iphone 3g? There are NO iPhone 3G owners (unless they paid $500/$600 for a non-contract phone, in which case this doesn't matter to them either) out there who are eligible for upgrade in the next couple of months! The soonest is March.

Thank you AT&T for trying, please come again. Now why don't you go work on something useful like MMS or tethering!

I won't upgrade, and when my contract expires, if not sooner, I will leave the iPhone until such time as I have a choice other than ATT. This is entirely ATT's fault. This pricing debacle is just the icing on the cake for me.

While traveling between Burbank, CA and Pasadena, on the 134/210 freeways last Sunday, I received a call that a friend had taken seriously ill.

that call, between my iPhone and a land lione, was dropped 14 times in 6 miles.

someone at Apple or AT&T probably ran some financial modeling and figured out that letting people upgrade early and having people buy up 3G iphones on Craigslist is a cheap way to get new customers. cheaper than selling them new 3GS's

What about us in Canada on Rogers? Who gives a crap, I will wait until July 11th because that's when my year is up. It isn't Rogers fault I bought a phone less than a year ago. I would love to get it on Friday but ces la vie!

I bought my 3G the very first day it went on sale, and AT&T just told
me that I'm still not eligible until March 2010. So apparrently the
only people elibigle are ones that bought an original iphone before
spring 2008, and did not extend their contract to get a 3G.

Sounds nice for PR purposes, but a useless gesture for most of us.

"AT&T on Wednesday published an open letter to customers on its iPhone 3G S upgrade eligibility program in which it announced that, for a limited time, it will offer early iPhone 3G adopters the opportunity to purchase an iPhone 3G S at the same $199 and $299 price points as new customers."

Now, it has extended the offer to anybody who bought their iPhone 3G as late as the end of September.

"AT&T on Wednesday published an open letter to customers on its iPhone 3G S upgrade eligibility program in which it announced that, for a limited time, it will offer early iPhone 3G adopters the opportunity to purchase an iPhone 3G S at the same $199 and $299 price points as new customers."

Now, it has extended the offer to anybody who bought their iPhone 3G as late as the end of September.

Um, no. Apparently not according to the records of AT&T and Apple - when I go through the process to order, it shows the higher prices, and states that I'm not eligible until 03/2010.

CORRECTION - I see now that their upgrade tools will be reflecting this change tomorrow. Sorry for my snarkiness. :-)

Nice gesture, but it didn't really address the bulk of the complaints, not that I expected them to do so. The article's caveat to this news was half way to two thirds of the way into the text. I wonder how what proportion of people are on plans expensive enough to earn a new phone subsidy within 12 months.

My wife and I are on a family plan and we pay about 170/month for 2 iphone 3Gs. I'm not eligible until 3/11/10 and I got mine on day one. She got her 3G in august but because she is the primary they are giving her a break and letting her upgrade in August as well. This will affect us and we will be upgrading now. Or at least one of us will.

And for all those wondering if they will be eligible, you need to wait until tomorrow to check AT&T's site to see if you'll be eligible or not. It won't update until the 18th it says.

I bought my 3G the very first day it went on sale, and AT&T just told
me that I'm still not eligible until March 2010. So apparrently the
only people elibigle are ones that bought an original iphone before
spring 2008, and did not extend their contract to get a 3G.

Sounds nice for PR purposes, but a useless gesture for most of us.

Same here, when I log in to Wireless.ATT.com and click upgrade I get a message saying it will be before March 2010 before I am allowed to upgrade...

I'm not pleased with that at all, so what exactly is AT&T doing for us 'early iPhone 3G adopters'?

I might just pay $399 for the phone and then I'll have the freedom of leaving when a new iPhone comes out on a different network (When is Verizon's 4G GSM network going up??)